MESA - NASDAQ

Thank you for standing by, and welcome to the Mesa Airlines Q3 Investor Conference Call. [Operator Instructions]. This call is being recorded. I would now like to turn the call over to Doug Cooper, Head of Investor Relations. Mr. Cooper, you may begin.

Thank you, Christina, and welcome, everyone, to Mesa's earnings conference call for its fiscal third quarter ended June 30. On the call with me today are Jonathan Ornstein, Mesa's Chairman, Chief Executive Officer; Brad Rich, Executive Vice President and Chief Operating Officer; Michael Lotz, President; and Torque

Thank you, Doug, and thank you, everyone, for joining us today. Let's get down to business. As anticipated, while traffic remains strong and our partners continue to request more hours, the industry-wide pilot shortage impeded our ability to meet that demand. We continue to do everything we can to mitigate the impact of the shortage. However, there's only so much we can do given our financial capabilities and the overwhelmingly negative fundamental issues created by the so-called 1,500-hour rule. With greater barriers to entry to become a commercial pilot in the form of increased time requirements and higher costs, we have seen pilot shortages and corresponding elevated wage levels, ultimately leading to higher fares for consumers and decreased levels of air service. With the greater diminished supply of entry-level pilots and the greater post-COVID demand for pilots at the major airlines, the regional industry is caught in an unprecedented squeeze and the highest levels of pilot attrition in history and a shrinking pool of qualified commercial pilots without the necessary amount of hours. Strangely enough, there is, in fact, actually a huge pool of pilots that have their commercial licenses, but are unable to fly commercially in scheduled service. Unfortunately, these pilots oftentimes need over 1,000 additional hours to fly commercially, which their license would imply they already have the ability to do. MESA is focusing on this group as a future resource. We are now looking at opportunities to accelerate their development and accumulation of hours within the constraints of the 1,500-hour rule. In addition, we are exploring options to enhance pilot retention. While it is important to note this problem is broader than just pilots, we are also making progress with other labor groups and to improve attraction and retention. One significant benefit we were able to implement this quarter was announcing that all Mesa pilots, including pilot flying in our American Eagle and DHL operation could participate in United Airlines career development program, Aviate, which provides a path to employment at United. We believe this will enhance recruiting and retention of pilots. This may well be the fastest way for a pilot entering commercial aviation to advance to a major airline while giving us the visibility into future transitions. Turning to our DHL cargo operation, our third Boeing 737-400 aircraft entered revenue service. While the growth of our cargo business has been somewhat slower than initially anticipated, going forward, we believe cargo has the potential to be an increasingly important part of our business. With that, I will hand it over to Brad Rich to go over more of the details and an update on our operational performance this quarter.

Thank you, Jonathan, and good afternoon to everyone. As Jonathan mentioned, we continue to face a well-documented industry-wide pilot shortage that has significantly impeded our ability to operate at the level of flying that both our partners and Mesa expect in order to adequately serve passenger demand levels. As we navigate through issues linked to the pandemic and its associated impacts on travel, we are turning our efforts more heavily toward addressing our current labor challenges, which I will discuss in more detail. Most importantly, we remain committed and focused on delivering strong operational performance as well as implementing effective initiatives to ensure that we are able to provide safe, reliable and high-quality service to our customers. In the June quarter, we flew 63,486 block hours, which is a 25.5% decrease from the same quarter last year and a 3.2% decrease below the March 2022 quarter. Our combined controllable completion factor was 96.7% compared to 99.9% a year ago. Both our production and our combined controllable completion factor are below the 2019 levels and have been significantly impacted by a reduction in capacity, which has increased loads, making it more difficult for our crews to commute as well as COVID-19, which is driving high absence rates. We are also facing elevated attrition as larger carriers add capacity and replace pilots due to attrition and early retirements. Both our on-time and completion performance remain at levels below expectation, and the primary driver has been the spike in sick calls related to the latest COVID resurgence. Based on current trends of attrition and training output, our block hours are expected to be down next quarter by roughly 12%. And due to the volatility of the factors involved, we are not able to provide further guidance at this time. During the quarter, our recent pilot agreement did not pass after initially receiving unanimous support from our pilot union leadership. Unfortunately, the timing of the vote was not ideal as it coincided with an offer announced by another large regional carrier, which increased compensation by approximately 100%. It is important to note that we have always maintained a constructive relationship with our pilot union, and we continue to discuss creative ways to reach an agreement with our pilots. We are also continuing our negotiations with flight attendants, where we believe we are making progress. We also recently instituted enhanced compensation at some of our maintenance basis. Looking ahead to the remainder of fiscal year 2022, we are focused on operating the airline as productively and reliably as possible. While demand remains very strong, we remain pilot constrained due to the 1,500 hour rule and accelerated attrition to the major airlines. Our primary challenge is elevated pilot attrition and our ability to mitigate it through effectively recruiting pilots and efficiently moving them through training. To bolster our management team, we have brought in several key leaders, such as our new Senior VP of Flight Operations, John Hornibrook, who comes to us from Boeing and has extensive knowledge of training and flight operations from his long career with Alaska and Horizon. We are also in the final stages of developing what we believe will be an industry altering solution to the current pilot shortage. As mentioned on previous calls, we have secured additional simulator time for both regional equipment types and recently had a second CRJ simulator come online in July. We also have a third E-Jet simulator to be delivered for the summer of 2023. We continue to implement programs to continue to attract new pilots to Mesa, particularly through the United Aviate program as Jonathan mentioned, as well as a new $50,000 bonus for new hire pilots starting August 1. We have recently invested in advanced software systems to enable us to effectively manage our training pipeline and critical resources needed to meet our training plans. Although the industry pilot situation is a major focus, I wanted to also provide some information regarding our tech ops division and areas of focus. We have recently made some changes and enhancements through consolidation of our maintenance footprint and improvement in performance through prioritizing key locations. Now we're focusing on enhanced automation through iPad technology and improved troubleshooting. We're updating software for parts sourcing. We have several additions in some key leadership roles. And as I mentioned, we have enhanced our mechanic pay. We believe our relationship with our partners remain very strong, and we continue to have productive conversations regarding future capacity as it relates to both short- and long-term strategies. We remain focused on operating our core regional business safety and reliably with the health and safety of our people and our customers being our top priority. Now with that, I'd now like to turn the time over to Torque, who will walk us through our financial performance.

Thank you, Brad. I'll take this opportunity now to review our financial performance, our capital outlook and our balance sheet. For the third quarter of fiscal year 2022, we reported a net loss of $10 million or $0.28 per diluted share compared to a net income of $4.3 million or $0.11 per diluted share in Q3 2021. On an adjusted basis Mesa has reported a pretax loss of $8.7 million for Q3 2022 compared to a pretax income of $5.8 million for Q3 '21. It's important to note that the adjusted pretax loss for Q3 excludes $100,000 impairment adjustment related to the abandonment of one of our leased facilities as well as a mark-to-market noncash loss on our investments in equity securities and related impact upon our income tax expense. The year-over-year decrease of $14.5 million was primarily due to lower block hour production and the PSP program funding that has now ended. Compared to Q2 2022, we did see sequential improvement on our financial performance on essentially flat block hours. Revenue in Q3 2022 was $134.4 million, an increase of $9.2 million or 7.4% from $125.2 million for Q3 2021. This is ahead of our expectations. Our contract revenue increased by $9.2 million year-over-year as rates returned to normal levels after temporary reductions related to the PSP program. This was partially offset by a 25.5% reduction in block hours flown versus the same period last year for our major partners across all fleets. Pass-through and other revenue remained relatively flat to last year, primarily due to pass-through maintenance expense. And as a reminder, the pass-through expense has no P&L impact to Mesa's performance. Mesa's Q3 2022 results include per GAAP the recognition of $6.8 million of previously deferred revenue versus a deferral of $1.9 million of revenue in Q3 2021. The remaining deferred revenue balance will be recognized as flights are completed over the remaining terms of the contract. On the expense side, Mesa's overall operating expenses for Q3 2022 were $134.2 million, up $23.4 million versus Q3 2021. Similar to last quarter, the largest cost variance compared to Q3 2021 as the $26.1 million for the PSP-related grant that has now ended. Mesa's flight operations expense was up $1.9 million versus last year, primarily due to higher training. Maintenance expense continues to normalize as we are past the high number of engine overhauls and heavy C-checks that were deferred at the beginning of COVID. Maintenance costs was $49.7 million in Q3 2022, down $2.3 million versus Q3 2021. Next, let me review where we are on cash and liquidity. Cash for the quarter, excluding restricted cash, decreased by $21.4 million to $54.4 million. During the quarter, we made scheduled debt payments, including finance lease payments of $18.9 million and had operating lease payments of $4.5 million. Block hour production was down more this quarter than we had anticipated as we worked closely with our partners to fly as much as possible while still flying a reliable schedule. The new block hours had a direct impact on our cash coming in lower than we had anticipated. Total debt at the end of the quarter was $653.4 million, which is up $1.4 million from the prior quarter. We took delivery of a new engine in the quarter, which we had previously established financing, and this is the primary increase in debt of the quarter, offset by other debt repayments. We have planned to sell 18 of our CRJ-700 aircraft that we have currently leased to a third party. Well, I can't show the details at this time. We anticipate this to add liquidity over the next few quarters. This is in addition to other previously announced initiatives to strengthen our balance sheet. While we cannot provide specific financial guidance, we will provide some color in a few areas. As mentioned earlier, we expect there to see continued pressure on block hours through the rest of the fiscal year and anticipate block hours, as Brad mentioned, to be down about 12% for the next quarter. We plan to continue working closely with our partners to address the impact of the decrease in block hours and pilot attrition to our business. The reality is that our contracts contain utilization provisions that were never envisioned in this highly pilot constrained environment. And we feel it's unreasonable for us to continue to incur panel utilization penalties during an industry-wide pilot shortage and the constraints in imposed block hours. Our partners are well aware of this, and they know this is an industry-wide problem, and we've been working constructively to address these unprecedented and evolving issues. And we know that there is more work to be done. We'll be optimizing maintenance costs over the next few quarters as well and expect to be flat or down from the current quarter based upon reduced block hours. Now I'd like to turn it back over to Jonathan.

Thank you, Torque, and we appreciate the financial recap. In summary, we continue to see 2022 as a challenging year for Mesa. While we continue to face significant near-term issues, we believe that by working together with all our partners and our employees, we will successfully navigate through this period and position ourselves for the future. At this point, operator, please open up the call as I'd be happy to field any questions that the analysts may have. Thank you very much for listening, everyone.

[Operator Instructions]. Our first question today comes from Savi Syth.

I think Brad briefly mentioned this, but I was curious if you're seeing what you expect the impact of the new pay rates that one of your competitor -- in-house subsidiary, some of the big pay increases that we've seen there, are you seeing an impact on kind of retention or kind of recruiting aspects of your business as well as what does this mean in terms of kind of compensation for your pilots?

This is Jonathan. And Brad, if you want to pipe in at any time, feel free. But I think at this point, I would say there's an impact. I'm not sure if we know what it is yet. Attrition levels have been pretty much flat throughout that. We had hoped that things would slow down a little bit, and they hadn't slowed down. That may be partly as a result of that. I do know we had some pilots go to that carrier, obviously, as a result of that. I think long term, what it's just concerning is just a question of what's the impact on the industry when there's, I think, a fairly reasonable chance that, that kind of pricing could make a chunk of the fleet economically obsolete over time. But that's sort of what we're going to have to see what happens. I think the real solution here and what you might have heard Brad and Torque and myself mentioned is we've got to figure out a way to open up the pipeline of pilots. There's plenty of pilots out there that have commercial licenses, which by definition, you would think they could fly commercially, but not under the new the new regs. So when you've got a huge number of people who are seeking those extra 1,000 hours, I think the real question is how do we get them into the commercial market as fast as possible, because that ultimately will be what solves this problem, is getting people through that pipeline quickly. It was a little bit surprising to us because we were in the middle of a boat. That boat, as Brad pointed out, we had received unanimous support from the MEC. We think it was a very amicable deal. We put it together quickly. Everybody was anxious to move forward. And unfortunately, that deal put it in a position where I think even our MEC leadership was disappointed that we were stymied as a result of that, not that such a significant increase occurring mid-contract.

That's helpful. It seems like that is a general response for most of the industry trying to figure out what this all means. If you don't mind, can I ask you -- you talked about you have the second CRJ simulator, you have the E-175 simulator back in July. What does that do in terms of kind of your pilot training capacity? Does that kind of double it? Does it -- how much does that help in kind of getting through pilots from -- through training? And just you had a goal of kind of increasing the number of instructors as well. I mean, was there a certain target there? Has that been met? How is that kind of component of--

No, that's a great question. So when you look at the sims, you have to realize that there's a certain amount of sim time that's required every month just to do recurring training. So you would think like going from 2 to 3 means you have 33% more capacity. Well, actually, what that means is we sort of double the capacity in terms of new hires and our ability to upgrade people. In other words, to go just beyond the recurrent, which is sort of that baseline number and then go from there. In terms of instructors, we have been focusing on the Embraer 175, which is where we felt we had the biggest demand. And I'm very pleased to tell you that last I checked, we had more than doubled the number of instructors and I think that that is becoming less and less of an issue for us. We were certainly caught a little short a few months ago. Part of the problem was we had a, frankly, a slew of instructors that had traded out as the majors continued the hiring spree for the most part, just as a result of the early retirements from the year before. So when you lose 4 or 5 people in a small group of 20, it can have a big impact. But I think we've been creative in terms of getting some additional people from the pilot ranks who can get trained very quickly. And at the same time now on the longer-term basis, we're hiring a lot of those retired pilots to come and fly for us in the sim, who just take a little bit longer to train. They take about 3 months because they have to go through the entire training program as opposed to just a couple of weeks for the pilots who are already trained in the type. So we think we have a short-term solution, and we're also now working on a longer-term solution so that we could free up assets to continue to fly aircraft.

Our next question comes from Hillary Cacanando.

Calling in for Mike. So you mentioned the $55,000 signing bonus, I guess starting this month. Just wondering if you have received any feedback from potential candidates and recruiters, and if you think that will help a lot?

Yes. I mean on the bonus, I think the bonus is an interim measure for us because we are looking to ways to improve retention and attraction through our pay scale. As we mentioned, we did have that deal voted down. But we have a good relationship with the ALPA leadership here. And I think we will have a solution for that in the not-too-distant future. In the meantime, we put that bonus in because clearly, it has become more competitive. And we're talking about a reservoir that is being trained where, I think, again, the long-term solution is to refill the reservoir, not for us all to just put bigger straws into that limited supply. So we've had a good response since we entered it. So I think we'll be okay. It's obviously an expensive proposition. And to be frank, I think like any CEO, I'd rather see that money go to our people than to go to new hires just to get them in the door. So I think there are other ways that we can solve this issue. It's just going to take a little bit more time. And so this is the interim solution so that we can be sure to keep our training classes built.

Got it. Got it. And then I think last quarter, you mentioned that Gramercy, your partnership with Gramercy Associates is on track and that you were expecting to get the European certification completed. I think in this quarter, third quarter of 2022, is that right? Wondering if you could kind of go over that a little bit more?

Yes. We were looking -- this is Mike Lotz. We were looking to start it in the fourth fiscal quarter, and now we're looking -- we pushed it out to the second fiscal quarter of next year. It's just an issue of timing with the regulators in where the AOC is being registered in Malta.

Our next question comes from Helane Becker.

Jonathan, is there an argument to be made for consolidation at this level in an effort to solve the pilot issue? And is that something you would consider?

Yes. No, Helane, that's a really good question. And you and I have been talking about consolidation since America West days. The fact of the matter is you've got basically half the number of people trying to fly all the aircraft. And so there is some sense to be made where there's no fundamental flaw to our business beyond this pilot shortage. I mean, to be frank, if we could fly all of our people that we have today in one of our operations, we'd be very profitable. The problem that we're facing is just the fact that our utilization is down across the board. And as everyone knows in the industry, you've got these high-cost fixed assets that you just have to fly. And if we're flying 6 to 8 hours a day, we're not going to make money. If we can fly 10 to 11, we do quite well. And so yes, I do think that there's an argument to be made. And the fact of the matter is the pilots are now obviously, very good assets. And I think that other companies -- and certainly, Mesa would be looking to see if there's ways for us to utilize these assets in a way that generates a profit rather than the losses that we have. And to be frank, no small part of these losses are due to penalties which is somewhat encouraging for us, but one that we have to deal with. And we're working with our partners on that particular issue because, again, this is either COVID-related from -- due to the early retirement or as a result of legislation that we've been working hard to try to modify without literally any success and to the large degree out of our control. But that being said, we have to be creative, and we have to look for ways to get the company return to profitability. Again, I said on the last call, just crazy when you think about it, who would have ever thought that it's easier to go into COVID than it was to go out of COVID. And that's really what's happened. We've just -- it's just been very difficult coming out with the demand for hours, particularly domestically. And we're working as hard as we can to get those numbers back up. But when you lose between 4% and 6% of your workforce a month as opposed to 12% a year, it just creates challenges that even with the train department up running and the correct number of simulators, I think every regional airline is going to face challenges to keep up that kind of output.

Right. So off topic, what would you -- or what do you wish we would ask you about instead of pipelines. Like what do you want to talk about with respect to the business that's like the major takeaway here?

Well, I mean, jokingly, I wish you would be asking me are you going to be as profitable next quarter as you were this quarter? But I mean, I think the biggest subject here is just the long-term future of the company -- of the industry if these wage levels that are introduced stick, and what that means for the regional jet. It wasn't that long ago that we were operating 19 and 30-seat airplanes and changes in legislation effectively wiped that business out. Now I'm not suggesting that's going to happen here because I think all the majors look at the regional jet as critical pieces of their network, that the rest of the hub doesn't work, the regional jet doesn't work. I just think it's going to have an impact on pricing and service levels throughout the country. We've already seen a reduction in service in 70% of all U.S. markets, which I believe is directly tied to the pilot shortage. It's a question of how much further it gets. For us, I think the key would be things that would help us a lot now. I do believe we're going to have a program in place that will accelerate pilot development. I can't go into a lot of detail. We're subject to a bunch of NDAs right now, but I think that we're going to be looking at a program that could, in fact, break this logjam and change the industry, and I believe this, I think we could change the industry as much or more as the first capacity purchase agreement. Because if we can get over the hump of the 1,500 hour rule and all the negative impact, I think that would really change our outlook significantly. It would change our ability to fly the hours that we need. I would put pressure on wages. It would just do a lot of things that could, I think, alter the current trajectory of the industry. And it won't take that long to implement. We're not talking about years, we're talking about months. And the question is, will the majors have the patience to deal with this for a couple of months? And I think the answer is a resounding yes because the regional jets are still really critical part of their network. I mean, you look at American, I think they have plans to operate close to 700 jet. United is close to 300, even at the core level of just 76 passenger jets, I think that we just have to make it over this hump and look out beyond this issue because, as I mentioned, there are plenty of pilots in the pipeline, but getting them from 250 hours, which is when they use to go fly for us and those same amount of hours they can fly all around the world with to that 1,500 is the key. And that's what we're focusing on solving that problem. I would also add to that just real quickly. I think that cargo continues to play a small role at Mesa, but we did add our third 737. We are looking to expand that. DHL has been absolutely a wonderful partner. I mean, I have to tell you, there was no doubt that we had -- it wasn't easy for us to put those aircraft on certificate. They were older aircraft. They had to be integrated into operation and DHL was thoughtful and helpful and supportive. And I think that we feel that there still remains a big future operating as a DHL carrier in the family there. So that, to me, hopefully, will be the next big move that we can see us continuing to add 737s and potentially larger aircraft down the road as we get to be more familiar with the cargo operations in the world of cargo, which is all very new to us.

[Operator Instructions]. Our next question comes from Andrew Didora.

So Jonathan, when I just take a look at your light operations cost per block hour came in at like $680 this quarter, up $200 from last fall. We've obviously talked over the -- on this call past quarters, just the drivers of that from -- with the pilot issue, the bonuses, the block hour pressure training costs and everything. Do you see any sort of stabilization coming in that number? Or is that -- or do you see a level that, that resets to higher just given what we're seeing in wage rates across the regional environment right now?

Andrew, it's Mike. I mean, look, the cost per block hour now is extremely high just given the combination of local block hours and high training costs and the bonuses that we're paying. So going forward, that number will come down when the attrition starts to level off and we're able to just to increase the number of lockouts. We're just in a situation right now that hopefully it's temporary, but it will change as the attrition pavers down or we're able to get enough people through the training cycle to build our block hours up to 8%, 8.5%, 9%, and then we'll see it come down to some of the levels that's been out in the past.

Got it. And can you just give us a sense of kind of that bucket, what percentage of that is just pure pilot wages, pilots on the line flying?

Yes. I don't have that off the top of my head, Andrew, but I can get it for you after the call.

And correct me if I'm wrong or Torque, I think that the bulk of it still remains the level of training that we're doing. I mean we are really -- of the increase. It's still around training. And to be frank, there's no choice. I mean we've got to be able to train as many people as we possibly can on attrition. In fact, last month, I think was one of the first ones where -- and correct me if I'm wrong, but that our output from training was not far off of our -- of what we lost through attrition. So we're making progress, but it's going to continue to take work. And talking around the industry, maybe misery loves company, but it sounds like everybody is sort of facing the same challenge right now.

Andrew, just to kind of ballpark it, roughly about 25% of our pilot wages in the quarter was related to training.

Our next question comes from Savi Syth.

I had a couple of just quick housekeeping questions. So the block hour down 12%. Is that year-over-year or quarter-over-quarter? Similarly, kind of with the maintenance expense commentary, was that a quarter or quarter comment or a year-over-year comment?

This is Torque. It was quarter-over-quarter.

Okay. Makes sense. Just a bigger question. Kind of what's your sense, I mean, given -- Jonathan, you mentioned how important this is to the majors and you've heard them kind of say that as well as long as it's economical. But like what's the ability to pass through some of these kind of pay increases, be it pilots or even some of the other groups in your contracts? Like how long do you think that would take?

Well, it's a good question. Obviously, we're having those discussions now. And based on our model, I mean, when we're making a 5% or 6% margin in good times, I think it would not be hard for all you guys who model certainly as well as we do, that this level of increasing compensation clearly will require support from our partners. That being said, I think that they are obviously understanding that and will be reasonable because I think they have a vested interest in seeing Mesa continue to provide the lift that we do provide, albeit at lower levels now. But I think that they also appreciate the fact that -- I mean look at it from like an American, for example, if they feel it makes sense for them to raise wage levels, they have to think that it would make sense for us as well. It can't be -- well, we can raise them over here, but you guys are okay because there's just -- we can't be competitive. So I think that they appreciate that. I know United appreciates it. And so I think that ultimately -- and remember, too, Mesa has always been a low-cost provider. Our revenue that we generate for ASM has always been significantly lower than other regional carriers. And in large part, I mean, we're sort of just asking to get paid like everybody else has been getting paid for the last decade. So -- and that's not an exact science, but that's not too far off based on the numbers that we seem to feel are ballpark.

Jonathan, I think you said it well. I mean, obviously, everyone is very sensitive to the issue. But we've had, what I would characterize as productive discussions to the partners to the point still some more work to do but we're encouraged by the direction that's had. Want to do it in the most cost-efficient way that generates the best results long term. Brad, do you want to add anything to that? I mean, you're in a lot of discussions. Is there anything to add there? No. I mean, Jonathan, I think you've said it well. I mean, obviously, everyone is very sensitive to the issue, but we've had a very -- what I would characterize as productive discussions with the partners at this point. Still some more work to do, but we're encouraged by the direction it's headed.

Yes. And just, Torque, can I quickly ask, I know you were -- you said you can't talk about some of the initiatives you're working on. But is there a cash level that you're managing to or that you feel comfortable from a balance sheet perspective?

It's a great question. I mean we're obviously managing cash carefully, and we like to be around $50 million. But depending on where things are in some of our deals, I think it could be down a little bit lower than that, and we can manage through, right? But generally try to manage close to $50 million.

Because I'm showing no further questions at this time, you may proceed.

Okay. Well, thank you very much, everyone. I mean obviously, this is a difficult time. And as all of you know, Mike and I have been around working together for a long time. Torque has been in the business pretty much as long as everybody else just over at Alaska and Horizon. But I think it's fair to say that none of us have seen something so challenging that has lasted so long. I mean we all faced the horrific events of 9/11. We dealt with it. The industry came back. This is one that's just -- is clearly a longer-term issue. -- but one that I think we're going to have the wherewithal to address, one, because I do believe there are solutions. And two, I think our partners value what we do for them and are going to help us in terms of making our way through this over time. So I remain confident that Mesa will continue to operate in the regional airline space and to be able to do so profitably at some point. But it's just going to take a little bit of time to make that happen because when it comes to pilots and training, you just can't do things overnight, unfortunately. So I appreciate everyone's patience. I mean, believe me, we are disappointed to see our stock price where it is today as anyone else. But we have to just continue to operate the business and do the best we can moving forward given where we are and the macroeconomic aspects that we're dealing with within the industry. So again, appreciate everyone's time. Hopefully, we'll have a better report for you next quarter, and thank you again very much.